After Freeport, Vale (INCO) is Willing to Divest Shares to the Indonesian Government

PT Vale Indonesia stated that it was willing to offer a share divestment to the government in accordance with the PT Vale Contract Amendment Agreement and applicable laws and regulations.

“In essence, we are ready, but there are indeed stages that must be passed,” said PT Vale’s Senior Communication Manager Suparam Bayu Aji in Surabaya, East Java, Saturday (01/05/2019).

The current development regarding the divestment, PT Vale has submitted a letter to the Minister of Energy and Mineral Resources in connection with the process of implementing PT Vale’s divestment.

According to Bayu, PT Vale is just waiting for the direction of the stages imposed by the Ministry of Energy and Mineral Resources to fulfill the divestment according to the amendment to the work contract.

Member of the House of Representatives Commission VII, Ahmad M Ali, highlighted the renegotiation of PT Vale Indonesia’s shares to be offered to the government.

Ahmad Ali, in a written statement received in Jakarta on Sunday, said that the amendment to the work contract also stated that the process of divesting the shares of PT Freeport Indonesia, PT Vale Indonesia, the Brazilian nickel mining company, was dominated by Indonesia.

He explained the current condition that royalty payments were increased from 0.9% to two percent, and to 3% if nickel prices touched US $ 21,000 per ton.

This clause, according to him, is considered inaccurate. Even during the commodity boom where mineral commodity prices reached their highest level in 2011, world nickel prices did not touch the level of US $ 21,000.

He also judged this figure to be too high and did not refer to the factual context of nickel commodity prices over the past ten years, which was marked by the end of the era of commodity price surges.

In addition, he said, until now Vale has never offered a 20% stake to the Indonesian side. The realization of the construction of a smelter in Bahodopi and Pomalaa also stalled.

Entering the end of the year, PT Vale produced 18,193 metric tons of nickel in the third quarter of 2018 or below the target.

Source: bisnis.com

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